ElasticSwap — Staking FAQ
Since the deployment of our new staking contracts, we have been getting some questions that warrant a closer look. You can read the initial article we published here but we want to take a deeper dive to address some of the questions we have been getting from our community and figured if they are asking, others likely would appreciate similar answers.
The unrealized $TIC that is shown in the UI on the staking page… Is that inclusive of the USDC.e portion of the ELP?
Once fees are accrued by ElasticSwap, we convert those fees to USDC.e and use the unclaimed rewards to mint ELP tokens (TIC-USDC.e) that become claimable. So that $TIC you see accumulating, is only half of the rewards you will actually get when they become claimable.
So if I have unrealized rewards of 1 $TIC and $TIC runs to $100, will I get $50 worth of $TIC and $50 worth of USDC.e?
No, you will get an ELP with 1 $TIC worth $100 and $100 worth of corresponding USDC.e, in the form of an ELP token. Essentially you get double the value of the unclaimed $TIC.
Why did ElasticSwap choose to implement this new staking design?
Well, we did so for a bunch of reasons, but 2 big reasons are:
- This means our stakers profit when the protocol profits, aligning incentives. i.e. Our community is incentivized to get the word out and help drive traffic to our protocol.
- Rewards now contribute to the depth of the TIC/USDC.e liquidity pool.
Another sweet option for stakers who claim their rewards, is the ability to claim ELP reward tokens, exit for the underlying $USDC.e and $TIC, then restake the $TIC in the single-staking pool. Wash, rinse, repeat… for as long as you want. Stakers can take up to 50% of the profits off the table for taxes or other uses without creating sell pressure.
What happens if there isn’t enough volume to supplement with collected $USDC.e fees?
We can only distribute what we generate in fees, so if this were to be the case, unrealized $TIC rewards would remain unrealized until the protocol generated more fees.
How often will fees be paid out in staking rewards?
Fees will be distributed every 2 weeks, assuming there have been at least $10,000 of fees collected. We will plan to increase the frequency once the process is more automated and as the protocol scales.
Are you locked in? What happens to the unrealized $TIC rewards when someone exits the staking pool?
A staker can leave the pool at anytime, but forfeits their unrealized rewards. In that event, the unrealized $TIC rewards go to the treasury.
This is a new approach for AMM staking pools that we at ElasticSwap feel aligns everyone’s interests. We are here to try things no one else has tried before. You can count on us to keep innovating, iterating, and buidling.
The future is #ElasTIC!
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